October 27, 2013

Stambovsky v. Ackley | Case Brief Law Student - 169 A.D.2d 254 (1991) - Supreme Court, Appellate Division, First Department

Facts: The plaintiff contracted to purchase a house from the defendants.  The plaintiff later discovered that the house was reputed to be possessed by poltergeists.  The defendant seller and members of her family reported having seen poltergeists over the previous nine years.

Procedural History: The county court dismissed the case and the plaintiff appealed.  The appellate division reviewed the case and ruled in favor of the plaintiff.

Issue: Is a buyer entitled to the recession of the contract of sale if all information which influences the value of the item being purchased is not released by the seller?

Holding: Yes

Rationale: The bargaining process to purchase a home is based upon both the home's value and its potential for future resale.  The reputation of a home influences both the home's value and  potential for resale.  Failure to disclose the reputation of the property violates the bargaining process because reputation can influence the home's value and potential for resale.

Disposition: Rescinded the contract of sale without cost to the plaintiff.

Interesting Dicta: Having poltergeists is a condition which cannot be found through reasonable inspection of the property.  However, when a seller discloses information about poltergeists on the property to the public, the seller is then obligated to release that same information to any buyer.